RH Stock Plunges 5.33% as Trump's Tariff Threat Sparks Sell-Off Ranks 186th in $450M Trading Volume

On August 25, 2025, RH (NYSE: RH) closed down 5.33% with a trading volume of $450 million, ranking 186th in market activity. The decline followed a major policy announcement by former President Donald Trump on Truth Social, where he declared a "major Tariff Investigation" on imported furniture. The investigation, set to conclude in 50 days, could impose unspecified tariffs on furniture imports, with RH particularly vulnerable due to its reliance on overseas manufacturing—90% of its furniture is sourced internationally, primarily from Vietnam, China, Europe, Indonesia, and India.

Trump’s statement heightened sector-wide risks, triggering sell-offs across furniture stocks. While RH had previously benefited from a post-Fed rate-cut optimism and a 12% revenue increase in its latest quarter, the potential for additional tariffs threatens its cost structure. Analysts noted that RH’s limited domestic production (10% by dollar volume in 2024) leaves it exposed to margin compression or price hikes that could deter demand. The stock’s volatility, marked by 36 moves of over 5% in the past year, underscores investor sensitivity to macroeconomic shifts.

The proposed tariffs follow years of supply chain diversification by U.S. furniture firms, including RH, which shifted production from China to Vietnam and other Southeast Asian nations. However, current tariffs on China (55%) and Vietnam (20%) may not satisfy Trump’s push for "bringing the Furniture Business back to the U.S." The lack of clarity on whether the new tariffs would be layered on top of existing country-specific rates adds uncertainty. For RH, which operates in a premium segment, balancing pricing power against margin risks remains critical amid a still-fragile housing market.

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